17 July 2014
Dear Sir, My friend wants to sell his property in Bangalore. The property’s (30 *40 feet) market value is Rs 60,00,000/-. The same area’s guidance value is Rs.2500/- sq.feet. He has got one buyer and ready to buy at market price but he is insisting to register only at guidance value which is Rs. 30,00,000 (1200 sq * 2500). Buyer says he will pay Rs.30,00,000/- by cheque/dd and balance amount by cash. My friend has shortlisted another property of Rs. 75,00,000/- lakh and proceed of this sale is going to be invest there. Regarding this transaction we have following question 1) Can someone register property which is below market value (guidance value) ? Will it cause any issue for my friend either from income tax or from registration department?
18 July 2014
pls refer to sec 50 c of the act, if the property is sold below stamp duty value, then stamp duty value will be taken sas sale consideration and capital gain tax will be calculted accordingly. in your case, i think guidance value is stamp duty value . hence if u sale the property at rs 30 lacs, then there is no problem
CAclubindia
